BoE Floats Controversial Stablecoin Limits
The Bank of England (BoE) is considering capping stablecoin holdings at £10,000–£20,000 for individuals and £10 million for companies, according to the Financial Times. If implemented, the UK would become the only major jurisdiction to impose such restrictions, diverging sharply from the U.S. and EU, which are expanding regulation without ownership limits.
Officials at the BoE argue that these caps are necessary to protect the banking system from large outflows of deposits, which could undermine credit markets and lending.
She described the measure as “transitional,” but admitted there is no clear timeline for lifting the restrictions.
Coinbase and Industry Leaders Reject the Plan
The reaction from crypto firms has been swift and harsh.
He emphasized that no other major country, not even under Donald Trump’s second presidency, has tried such limits.
He warned that enforcing caps would require a costly new tracking system, such as digital IDs or wallet coordination, making it an impractical solution.
Treasury Pushes Innovation, BoE Holds Back
The debate has sparked tensions between the UK Treasury and the BoE. Chancellor Rachel Reeves has positioned herself as a champion of financial innovation, vowing in her Mansion House speech to “drive forward developments in blockchain technology, including tokenised securities and stablecoins.”
But BoE Governor Andrew Bailey has reportedly resisted Treasury efforts, even blocking Reeves from lobbying regulators to grant a banking licence to Revolut, the UK’s largest fintech awaiting approval.
Despite the criticism, the BoE plans to publish a formal consultation later this year on stablecoin regulations, leaving the possibility of caps very much on the table.
Global Market Marches Ahead
While the UK weighs restrictive measures, the global stablecoin market continues to grow, now worth $288 billion, with projections to reach $1.2 trillion by 2028, according to Coinbase. The U.S. Congress passed the GENIUS Act in July, integrating stablecoins into its regulated financial system, while the EU advances its MiCA framework.
UK Risks Falling Behind
Critics argue that the BoE’s approach paints crypto more as a threat than an opportunity, at a time when global peers are embracing integration. With stablecoins already powering fast, low-cost payments worldwide, industry leaders fear the UK risks losing its edge if it sends a message of hostility rather than leadership.
Whether the BoE’s proposed caps are truly “transitional” or a long-term barrier remains to be seen, but the backlash shows that crypto’s role in the financial system is no longer a side debate—it’s central to the UK’s economic future.
